Working Abroad

Working abroad can be a satisfying and exciting addition to your career development plans. That's because not only are your rewarded with a paycheck, but you also gain the opportunity to live in another country and experience their culture. Before you decide if working abroad is the right choice, we have some information that will help you make a more informed decision.

Learning about other Countries

Prior to moving, or taking a job abroad, you should learn about the country, or countries, where you are considering working.  The best approach is to research the country as if you were planning a vacation.  Travel agencies will provide tourist information, airlines carry brochures for the countries they fly to, the country itself might have a department of tourism, and certainly foreign embassies can provide you with up-to-date information on their countries.

You should read as much as possible about the countries that you are considering.  Make sure you understand their culture, local customs, and the political environment.  It is difficult to learn a new language as an adult; if you only speak English, then you might want to think about working in countries with a significant English-speaking population.

Travel Advisories

The U.S. Department of State maintains a current listing of travel advisories.  Such advisories, or warnings, are an important source of information when researching foreign countries.  Warnings or advisories can be a result of health conditions, crime, unusual entry requirements, or unstable governments.

The Department of State maintains consular data sheets for every country in the world, and their website is an important source of information if you are considering working abroad.

Documentation Needed when Working Abroad

The documentation you will need while working abroad will vary from country to country.  That being said, it's still possible to make some generalizations.  The first is that you will likely need a passport.  Even if the foreign country does not require a passport, having one will make it much easier when returning to the United States.  That's because a passport is recognized as the single best proof of U.S. citizenship.

You may also be required to obtain a visa, which is an endorsement or stamp that is placed in your passport.  A visa permits you to stay in a country for a specified period of time, and this is usually for a specified purpose - such as working.  Getting a visa is much easier if you do so before departing for work abroad.  You apply for a visa through an embassy, a consulate, or even a travel agent can help with the process.

Records of immunizations may also be required under international health regulations.  In particular, a country may require proof of immunization against cholera and yellow fever.  In some countries, typhoid fever vaccinations are also required.

Health Insurance

If you become hospitalized due to injury or illness, then medical care overseas can be very costly.  If you are working abroad, then make sure you thoroughly understand the process, and health coverage you are entitled to receive.  For example, make sure you understand the effective dates of insurance if you are covered by an overseas company.  If you are planning to continue coverage under a health insurance plan you have in the United States, make sure you understand the medical, dental, and health insurance you are entitled to under that policy.

Even if your health insurance covers you for medical expenses while working abroad, you may want to explore supplemental insurance for medical evacuation back to the United States.  Getting back to the U.S. can cost in excess of $10,000, and if you are not comfortable with the health care system of the country you will be working in, then you should consider purchasing this insurance.

Tax Implications of Working Abroad

In general, Social Security and Medicare taxes will apply to wages earned while working abroad, if one of the following conditions applies:

• The work involves an U.S. employer.
• You are working abroad in a country in which the U.S. has entered into a Totalization Agreement.  This type of agreement is a Social Security agreement between the U.S. and the country in which you are working.
• The work involves a foreign partner of an American employer under a voluntary agreement with the U.S. Treasury Department.  A foreign partner is one in which an American corporation owns a 10% interest in voting stock or profits of the partner.

Finally, if you are a self-employed citizen that is working abroad, you are subject to a self-employment tax on net earnings of more than $400 up to $106,800 in 2011 and $110,100 in 2012.

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